Silver prices reached a new record high of $82.00 per troy ounce, boosting focus on Hindustan Construction Company , one of the world's top five silver producers with 800-tonne annual capacity.

Silver prices extended their remarkable rally, clinching a fresh record high of $82.00 per troy ounce before paring gains to around the $80.00 level. The surge has been driven by multiple factors including low supply, rising demand, and an easing monetary policy cycle by central banks, putting Hindustan Construction Company shares in focus for trading.

Strong Silver Exposure Drives Focus

Hindustan Construction Company stands among the world's top five silver producers, with an annual capacity of around 800 tonnes. The precious metal serves as a meaningful profit driver for the company, contributing nearly 38% of its EBIT. This significant exposure positions the company as a direct beneficiary of the current silver price rally.

Brokerage Outlook and Stock Performance

Jefferies initiated coverage on Hindustan Construction Company with a Buy rating and a target price of ₹660, implying approximately 4% upside from current levels. The brokerage sees the company as a clear beneficiary of higher silver and zinc prices, aided by its first-decile zinc mining costs.

The stock has already delivered impressive returns, rising 44% in the year to date and 28% over the past month. Despite trading at 9.20x FY27E EV/EBITDA—above its long-term average of 7.30x—Jefferies believes the premium is warranted given silver's rising share in overall profitability.

Earnings Growth Projections

While volume growth is expected to remain modest, earnings momentum is set to stay strong. Jefferies projects EPS growth of 22% in FY26 and 29% in FY27, followed by another 7% increase in FY28. This outlook is underpinned by robust cash generation and healthy return ratios, with FY26–28 EPS estimates placed 9–31% above broader Street forecasts.

Silver prices have surged 172% to around $82.00 at spot, while Hindustan Construction Company expects the global silver market to remain in deficit. The company has assumed silver prices of $56.00–60.00 for 2HFY26–FY28, approximately 3–10% below prevailing spot levels.

Cost Efficiency Improvements

Cost efficiency has improved meaningfully across operations. Zinc cost of production (excluding royalty) has fallen from a peak of $1,257 in FY23 to $1,002 in 1HFY26. This improvement has been driven by several factors:

• Better ore grades
• Increased use of domestic coal
• Softer international coal prices
• Growing share of renewable energy

Looking ahead, costs are expected to remain largely stable over FY26–28E, as continued efficiency gains and higher renewable power usage are likely to offset the impact of deeper mining operations and fluctuations in ore quality.

With nearly 37% of its 2HFY26 silver volumes hedged at $37.00, most of the upside from higher prices is likely to flow through in FY27, delivering a meaningful boost to EBITDA.

Hindustan Construction Company Limited (HCC) has successfully completed its rights issue of fully paid-up equity shares worth ₹999.99 crores with remarkable investor response. The Securities Issuance Committee of the Board of Directors approved the allotment of 79,99,91,900 equity shares at ₹12.50 per share on December 23, 2025, following an oversubscription of 80.05%.

Rights Issue Subscription Performance

The rights issue witnessed exceptional investor interest, receiving total applications worth ₹1,04,29,15,843.96 for 83,43,32,675.17 rights equity shares against the offered 79,99,91,900 shares. This represents a significant oversubscription of 80.05%, demonstrating strong confidence in HCC's growth prospects.

Rights Issue Allotment Details

The Securities Issuance Committee meeting held on December 23, 2025, approved the final allotment following the finalization of the basis of allotment in consultation with the designated stock exchange, BSE Limited. The allotment was made to eligible shareholders and renounces as per the Letter of Offer terms.

Share Capital Transformation

Following the successful allotment, HCC's paid-up equity share capital has increased substantially from ₹181.95 crores to ₹261.95 crores. The company's shareholding structure has been enhanced to accommodate the new equity infusion from the rights issue participants.

Trading and Regulatory Compliance

The rights equity shares are expected to commence trading on BSE and NSE from December 30, 2025. The shares will be traded in dematerialized form only as ISIN INE549A01026. The rights issue allotment was completed in full compliance with SEBI Master Circular and other applicable regulations.

The successful completion of this oversubscribed rights issue provides HCC with substantial capital that strengthens its financial position for growth initiatives in the infrastructure development sector. The overwhelming investor response reflects confidence in the company's strategic direction and future prospects in the construction and infrastructure space.